Customer Data Requirements

We were doing a CRM workshop at a company.

While explaining the data part of the job, I wrote on the board

Then I asked “What information would you like to learn from your target audience?”.

Regardless of the industry, there are almost always the same answers. They also repeated the list below.

  • Name and surname
  • Date of birth (or Age)
  • Gender
  • Marital status
  • Education (must actually be the School He Finished From)
  • Job
  • Address

I wrote what was said on the board under Data.

Then I asked what the company expected from this work.

The answers were:

  • Which product groups sell better to whom?
  • Who are my most frequent customers and what do they buy?
  • Who are the customers most likely to respond to the offer offered?
  • Which customers are we likely to lose?
  • How often and how should we approach which customers?

and this kind of sentences…

I am not writing in more detail so that it is not clear which company it is.

This time, I wrote what was said under Needs.

Then, the image on the board was:

Let’s talk about how to use the data you mentioned to meet these needs. ” I said. “Does it interest you if someone has a PhD from the USA on advanced financing techniques?

No!” they said.

Does it matter if he is awarded as “the best driver of the city” since the last 3 years?” I asked.

No!” they said.

Apart from the main business subject of the company, I gave a few more examples of education and professions. All had the same answer: “No!

So it is not important for you to “know their profession”. “

I was finally able to get a “Yes” answer.

Its address is also important as you focus on Anatolia as a company. But only at the city and district level…

Yeah!” they said.

Now let’s take a look at the data list we just wrote with this perspective. Let’s ask ourselves again the data required to meet our needs.

After this beginning, we’ve created a more useful (and out of the box) data basket.

 

We took a break during the workshop. “We’ve never looked this way. We’ve been wondering what to do with the massive data mountain” they said, “We can determine our target more easily now.

😉

I have written many times. There are companies that have a lot of data and cannot use them (such as banks, GSM, supermarkets). However, it does not start with data, it starts with need.

Need → Information → Information (info) → Data

No wind (data) will help those who do not know where to go (need).

Operational Definition of the Customer

The definition of the customer should enable to answer the following specific questions like

  • How many active customers do we have?
  • How many customers we are about to lose?

Definition should enable to extract the accurate customers list – such as following examples –  from customer database via queries 

  • We have 3689 active customers.
  • If they (the customers) do not make this (any defined) transaction or not show up for more than 3 weeks we will lose 231 customers

Please notice that, in this assignment, our purpose is not to define the “target audience” of advertising agencies, but a FUNCTIONAL “measurable / operational” definition of customer for the selected sector.

In other words, I expect a measurable and comparable definition of customer such as

  • The person who buys gasoline from our station at least twice a month is our customer. However  the person who buys time to time from us while passing close to our station and stop by chance is not going to be considered our customer.   

The customer should be defined in such a way after querying from data warehouse the following groups of customers can be identified.

  • Active customer
  • Inactive customer
  • Lost customer

Thus, you can distinguish between valuable customers from the rest of the customers. These functional definitions are also essential if the purpose is to regain the lost customer. For example; by utilizing the measurable definition of the customer, when the customers who formerly defined as active customer became inactive customers it will be easy to identify those inactive customer and the target who are intended to be regained can be clearly identified. 

Important note: Those definitions should be “mutually exclusive and collectively exhaustive”. It means, their union must cover all the events, but no more than one event can occur at a given time. Just like puzzle, all pieces together form the complete picture and any of the pieces are not overlapping.

Once someone became a customer, she/he (on an institution) is either active or inactive or lost customer or some other cluster (such as pass through customer) . An area between them should not exist.

Please watch the following funny video to see how operational definition is important.  https://www.youtube.com/watch?v=cDA3_5982h8